SB 467 - This act creates new provisions of law permitting the creation of benefit corporations.CREATION OF BENEFIT CORPORATIONS (SECTIONS 351.1409 TO 351.1415)
Under this act, any corporation incorporated under the general corporation laws of Missouri may elect to become a benefit corporation by amending its articles of incorporation to indicate that it is a benefit corporation.
In order to be a benefit corporation, the corporation must create a general public benefit, however they may additionally choose to create specific public benefits. A general public benefit is defined as a material positive impact on society and the environment, taken as a whole, assessed against a third party standard.
RESPONSIBILITIES OF DIRECTORS AND OFFICERS OF BENEFIT CORPORATIONS (SECTIONS 351.1418 AND 351.1424)
The members of the board of directors of the benefit corporation or any committee thereof shall consider, among other things, the effects of any action or inaction upon the shareholders of the corporation, the employees of the corporation, and the local and global environment. However, such persons are not required to give priority to any person or group over another person or group unless specifically required by the corporation's articles of incorporation.
Directors and officers of a benefit corporation shall not be personally liable for monetary damages for any action or inaction taken in the course of performing their duties as a director or officer as permitted by law. Further, directors and officers shall not have a duty to any person that is a beneficiary of the general public benefit or special public benefit of the corporation.
BENEFIT DIRECTOR (SECTION 351.1421)
Each benefit corporation that is a publicly-traded corporation shall have a Benefit Director who is responsible for preparing an annual opinion addressing whether the benefit corporation acted in accordance with its general public benefit purpose and any adopted specific public benefit purposes. Additionally, the opinion shall address whether the directors and officers of the corporation acted in accordance with their required statutory roles.
The Benefit Director shall not be personally liable for an act or omission in his or her capacity as the Benefit Director. Any act or inaction shall only be considered an act or inaction in the person's capacity as Benefit Director.
ANNUAL BENEFIT REPORT (SECTIONS 351.1427 TO 351.1433)
Each benefit corporation shall have a Benefit Officer who shall be responsible for preparing an Annual Benefit Report. Each report shall include, among other things, the following information:
• A narrative description of the ways in which the corporation has pursued, created, or has been hindered in the pursuit or creation of the general public benefit purpose and/or specific public benefit purpose;
• An assessment of the overall social and environmental performance of the benefit corporation against the third-party standard.
Each shareholder of the corporation shall receive the Annual Benefit Report within 120 days of the end of the fiscal year or at the same time that the corporation delivers any other annual report to its shareholders. The report shall also be publicly available on its website. A copy of the report shall additionally be filed with the Secretary of State, which may charge a fee of $45 for such filing.
BENEFIT ENFORCEMENT PROCEEDINGS (SECTION 351.1435)
The act provides for benefit enforcement proceedings whereby certain entities may make a claim against the benefit corporation for violation of any obligation, duty, or standard required by law, or for failure to pursue or create a general public benefit or specific public benefit. Only the following entities may commence a benefit enforcement proceeding:
• The benefit corporation itself;
• A person or group of persons that owned at least 2% of the total number of shares of a class or series outstanding at the time of the act or inaction;
• A director of the benefit corporation;
• A person or group of persons that owned at least 5% of the outstanding equity interests in an entity of which the benefit corporation is a subsidiary at the time of the act or inaction; or
• Any person specified in the articles of incorporation or bylaws of the benefit corporation.
This act is similar to HB 1956 (2014).
SCOTT SVAGERA